EXHIBIT 10.12

                               RSI HOLDINGS, INC.
                             2002 STOCK OPTION PLAN

Purpose.
         The purpose of the RSI Holdings, Inc. Stock Option Plan (the "Plan") is
to promote the growth and  profitability  of RSI Holding s, Inc. (the "Company")
and its subsidiaries  from time to time (the  "Subsidiaries")  by increasing the
personal  participation  of key and  middle-level  executives  in the  continued
growth and financial success of the Company,  by enabling the Company to attract
and retain key and  middle-level  executives of  outstanding  competence  and by
providing such key and middle-level executives with an equity opportunity in the
Company.  This  purpose  will be  achieved  through  the grant of stock  options
("Options") to purchase shares of the common stock of the Company.

Administration.
         The Plan shall be administered by the Company's Board of Directors (the
"Board")  or, at the  discretion  of the Board,  a  committee  of the Board that
consists  entirely of two or more  "non-employee  directors" (as defined in Rule
16b-3  promulgated under the Securities  Exchange Act, as amended).  (References
hereafter to the  "Committee"  shall refer to the body  administering  the Plan,
either the Board or a committee of the Board, as the case may be.) The Committee
shall have complete  authority to (i) interpret all terms and  provisions of the
Plan  consistent  with law;  (ii) select from the group of key and middle  level
executives  eligible  to  participate  in the  Plan  the  key and  middle  level
executives to whom Options will be granted;  (iii) within the limits established
herein,  determine  the number of shares  subject  to, the term of and all other
terms and  conditions  applicable to each Option  granted to each of such key or
middle level  executives;  (iv) prescribe the form of  instrument(s)  evidencing
Options  granted  under  this  Plan;  (v)  determine  the time or times at which
Options shall be granted; (vi) make special grants of Options when determined to
be appropriate;  (vii) provide,  if appropriate,  for the exercise of Options in
installments or subject to specified conditions;  (viii) determine the method of
exercise  of Options  granted  under the Plan;  (ix)  adopt,  amend and  rescind
general and special rules and regulations for the Plan's administration; and (x)
make all other  determinations  necessary or advisable for the administration of
this Plan.
         Any  action  that  the  Committee  is  authorized  to take may be taken
without a meeting if all the members of the  Committee  sign a written  document
authorizing such action to be taken,  unless different  provision is made by the
bylaws of the Company or by resolution of the Committee.
         The Committee may designate  selected Board members or employees of the
Company to assist the Committee in the  administration of the Plan and may grant
authority to such persons to execute  documents  including  Options on behalf of
the Committee; subject in each such case to the requirements of Section 16b-3.
         To the  fullest  extent  permitted  by law,  no  member of the Board or
Committee  shall be liable for any action  taken or  determination  made in good
faith in connection with the Plan.

Eligibility and Factors to be Considered in Granting Options.
         Participation  in this Plan shall be  determined  by the  Committee and
shall be limited to those key and middle-level executives, who may or may not be
officers or members of the Board, of the Company or the Subsidiaries who have or
are likely to have the greatest impact on the Company's  long-term  performance.
In making any  determination as to the key and  middle-level  executives to whom
Options  shall be granted and as to the number of shares to be subject  thereto,
the  Committee   shall  take  into  account,   in  each  case,   the  level  and
responsibility of the key or middle-level executive's position, the level of the
key or middle-level executive's performance, the key or middle-level executive's
level  of  compensation,  the  assessed  potential  of the  key or  middle-level
executive and such other factors as the Committee may deem relevant.
         Directors  of the  Company  or any  Subsidiary  who are not also key or
middle-level  executives are not eligible to  participate in this Plan.  Options
may be  granted  under  this  Plan  only  for a reason  connected  with a key or
middle-level executive's employment.


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Stock Subject to Plan.
         The stock to be offered under this Plan, upon exercise of Options,  may
be  authorized  but  unissued  common  shares,   shares  previously  issued  and
thereafter  acquired by the  Company,  or any  combination  thereof.  Subject to
adjustment under Section 14., an aggregate of 4,500,000 shares (1,500,000 shares
upon  shareholder  approval of the  reverse  stock split to be voted upon by the
stockholders  of the Company at the Company's  shareholders  meeting on or about
June 10, 2002) are reserved for the grant under this Plan of Options, any or all
of which, at the Committee's discretion, may be intended to qualify as incentive
stock options under Section 422 of the Internal  Revenue Code (the "Code").  The
Committee  will  maintain  records  showing the  cumulative  total of all shares
subject to Options outstanding under this Plan.
         If an Option  granted  hereunder  expires or terminates  for any reason
without having been fully  exercised,  the  unpurchased  shares subject  thereto
shall again be available for the purposes of this Plan.

Allotment of Shares.
         The Committee may, in its sole discretion and subject to the provisions
of the Plan,  grant to eligible  participants  Options to purchase shares of the
Company's  common stock.  Options granted under this Plan may, at the discretion
of the Committee, be (i) Options that are intended to qualify as incentive stock
options under Section 422 of the Code;  (ii) Options that are not intended so to
qualify under Section 422 of the Code; or (iii) both of the foregoing if granted
separately  and not in  tandem.  Each  Option  granted  under  this Plan must be
clearly identified as to its status as an incentive stock option or not.
         Options may be allocated to  participants  in such amounts,  subject to
the  limitations  specified  in  this  Plan,  as  the  Committee,  in  its  sole
discretion, may from time to time determine.
         In the case of Options  intended to be  incentive  stock  options,  the
aggregate fair market value  (determined at the time of the Options'  respective
grants) of the shares with respect to which such Options are exercisable for the
first time by a participant  hereunder during any calendar year (under all plans
taken  into  account  pursuant  to  Section  422 of the Code)  shall not  exceed
$100,000.
         Options  not  intended  to qualify as  incentive  stock  options  under
Section 422 of the Code may be granted to any Plan participant without regard to
the Section 422 limitation.

Option Price.
         The price per share at which each Option  granted under the Plan may be
exercised  shall be such price as shall be  determined  by the  Committee at the
time of grant based on such  criteria as may be adopted by the Committee in good
faith;  provided,  however,  in the case of an Option  intended to qualify as an
incentive  stock option under Section 422 of the Code, the price per share shall
not be less than the fair  market  value of the stock at the time such Option is
granted (or 110% of the fair market  value of the stock in the case of an Option
granted to a person owning stock  possessing  more than ten percent (10%) of the
total  combined  voting  power of all  classes of stock of the Company or of any
parent or subsidiary corporation (a "10% Shareholder")).

Term of Option.
         The term of each Option  granted under the Plan shall be established by
the  Committee,  but shall not  exceed ten (10) years from the date of grant (or
five (5) years in the case of an Option intended to be an incentive stock option
under Section 422 of the Code that is granted to a 10% Shareholder).

Time of Granting Options.
         The date of grant of an Option under the Plan shall,  for all purposes,
be the date on which the  Committee  makes the  determination  of granting  such
Option.  Notice of the determination  shall be given to each key or middle-level
executive  to whom an Option is so granted  within a  reasonable  time after the
date of such grant.

Non-Transferability.
         An Option  granted  to a  participant  under  this Plan (a)  during the
optionee's lifetime shall be exercisable only by him or her and (b) shall not be
transferable  by  him  or  her  except  by  will  or the  laws  of  descent  and
distribution  or, with  respect to Options not  intended to qualify as incentive

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stock options under  Section 422 of the Code,  pursuant to a qualified  domestic
relations  order as  defined by the Code or Title I of the  Employee  Retirement
Income Security Act of 1974.

Exercise of Options.
         Subject to the provisions of this Plan, an Option may be exercisable at
such time or times after the date of grant  thereof and upon such  conditions as
may be determined by the Committee at the time of grant.
          Any Option granted  hereunder  may  be  exercisable  according to such
schedule as may be determined by the Committee.
         In   case  the  employment  with  the  Company  or  Subsidiary  of  any
participant to whom an Option has  been granted  terminates for any reason other
than his or her death or permanent and total  disability  (within the meaning of
Section 22(e)(3) of the Code), such Option may be exercised by him or her during
a period not exceeding three  months  after the date of such termination (but no
later than the end of the fixed  term of the  Option)  for the  number of shares
for which the Option could have been exercised at the time he or she  ceased  to
be an employee.
         If a  participant  to whom an Option shall have been granted  shall die
while in the  employ of the  Company or  Subsidiary  or within a period of three
months  after the  termination  of his or her  employment  with the  Company  or
Subsidiary or if a participant to whom an Option has been granted terminates his
or her  employment  with the Company or  Subsidiary  by reason of having  become
permanently and totally  disabled within the meaning of Section  22(e)(3) of the
Code,  such  Option  may be  exercised  by  him  or  her or his or her  personal
representative  during  a  period  not  exceeding  one  year  after  the date of
termination  of his or her  employment  (but no later  than the end of the fixed
term of the  Option)  for the number of shares  for which the Option  could have
been  exercised  at the time the person died or became  permanently  and totally
disabled.
         In no event may an  Option be  exercised  after the  expiration  of its
fixed term.

Method of Exercise.
         Each Option granted under this Plan shall be deemed  exercised when the
holder (a) shall  indicate  the  decision to do so in writing  delivered  to the
Company,  (b) shall  tender to the  Company  payment in full in cash (or, if the
Committee so determines at the time of grant, in shares of the Company's  common
stock) of the exercise  price for the shares for which the Option is  exercised,
(c) shall  tender to the  Company  payment  in full in cash of the amount of all
federal  and state  withholding  or other  employment  taxes  applicable  to the
taxable income, if any, recognized by the holder as a result of the exercise and
(d) shall comply with such other  reasonable  requirements and procedures as the
Committee may establish.
         No  person,  estate or other  entity  shall have any of the rights of a
shareholder with reference to shares subject to an Option until a certificate or
certificates for the shares has been delivered.
         An Option  granted  under  this Plan may be  exercised  for any  lesser
number of shares  than the full amount for which it could be  exercised.  Such a
partial  exercise of an Option shall not affect the right to exercise the Option
from time to time in accordance with this Plan for the remaining  shares subject
to the Option.

Cancellation and Replacement of Options.
         The Committee may at any time or from time to time permit the voluntary
surrender  by the holder of any  outstanding  Option  under this Plan where such
surrender is  conditioned  upon the granting to such holder of new Option(s) for
such number of shares as the  Committee  may  determine,  or may require  such a
voluntary surrender as a condition precedent to the grant of new Options to such
holder.
         The Committee  shall determine the terms and conditions of new Options,
including  the prices at and  periods  during  which they may be  exercised,  in
accordance with the provisions of this Plan, all or any of which may differ from
the terms and conditions of the Options surrendered.  Any such new Options shall
be subject to all the relevant provisions of this Plan.
         The  shares  subject to any  Option so  surrendered  shall no longer be
charged  against  the  limitation  provision  of Section 4. of this Plan and may
again become shares available for issue pursuant to the exercise of Options.
         The  granting  of new  Options  in  connection  with the  surrender  of
outstanding  Options under this Plan shall be considered for the purposes of the

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Plan  as  the  grant  of  new  Options  and  not  an  alteration,  amendment  or
modification of the Plan or of the Options being surrendered.

Termination of Options.
         An Option  granted  under this Plan shall be  considered  terminated in
whole or in part to the  extent  that,  in  accordance  with its  terms  and the
provisions of this Plan, it can no longer be exercised for any shares originally
subject to the Option.  The shares subject to any Option or portion thereof that
terminates shall no longer be charged against the limitation provided in Section
4. of the Plan and may again become shares subject to Options.

Adjustments upon Changes in Capitalization.
         In  the   event  of  a  stock   dividend,   recapitalization,   merger,
reorganization,  consolidation,  stock split,  reverse  stock split or any other
change  in the  characteristics  of the  shares  of  Common  Stock,  the  shares
available for purposes of this Plan or subject to Options outstanding  hereunder
shall be correspondingly  increased,  diminished or changed, so that by exercise
of any  outstanding  Option the  participant  will  receive,  without  change in
aggregate  purchase  price,   securities  and/or  property   comparable  to  the
securities  and/or  property that he or she would have received if he or she had
exercised  his or her Option  prior to such event and had  continued to hold the
common stock so purchased until affected by such event; provided with respect to
incentive  stock  options  under  Section 422 of the Code that, in the case of a
corporate merger,  consolidation,  acquisition of property or stock, separation,
reorganization or liquidation,  the excess of the aggregate fair market value of
the shares subject to any Option immediately after such event over the aggregate
option  price of such shares is not more than the excess of the  aggregate  fair
market value of all shares subject to the Option  immediately  before such event
over the aggregate option price of such shares.
         Adjustments  under this Section shall be made by the  Committee,  whose
determination  as to what  adjustments  shall be made,  and the extent  thereof,
shall be final, binding and conclusive.

Compliance with Securities Law and Other Requirements.
         No certificate for shares shall be executed and delivered upon exercise
of an Option until the Company shall have taken such action,  if any, as is then
required to comply with the applicable provisions of the Securities Act of 1933,
as amended,  the  Securities  Exchange Act of 1934, as amended,  any  applicable
state  securities laws and the requirements of any exchange or trading system on
which the common stock of the Company may be listed.
         In the  case  of the  exercise  of an  Option  by a  person  or  estate
acquiring  the right to  exercise  the  Option by bequest  or  inheritance,  the
Committee may require reasonable  evidence as to the ownership of the Option and
may require  such  consent and  releases  of taxing  authorities  as it may deem
advisable.

No Right to Employment.
         Neither the  adoption of the Plan nor its  operation,  nor any document
describing or referring to the Plan, or any part thereof,  shall confer upon any
participant  under this Plan any right to  continue in the employ of the Company
or any Subsidiary, or shall in any way affect the right and power of the Company
or any Subsidiary to terminate the employment of any participant under this Plan
at any time with or without assigning a reason therefore,  to the same extent as
the Company or Subsidiary might have done if this Plan had not been adopted.

Amendment and Termination.
         The Committee may at any time  suspend,  amend or terminate  this Plan.
The  Committee  may make such  modifications  of the terms and  conditions  of a
holder's Option as it shall deem advisable.  No Option may be granted during any
suspension of the Plan or after such termination.  Notwithstanding the foregoing
provisions of this Section, no amendment,  suspension or termination of the Plan
or  modification  of an Option  shall,  without  the consent of the holder of an
Option,  alter or impair any rights or obligations under any Option  theretofore
granted under the Plan except to the extent that  adjustments  are made pursuant
to Section 14.
         In addition to Committee  approval of an amendment to the Plan,  if the
amendment would (i) materially  increase the benefits  accruing to participants;
(ii) increase the number of securities  issuable  under this Plan (other than an

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increase due to an adjustment  made  pursuant to Section 14.);  (iii) change the
class of employees  eligible to receive  Options;  or (iv) otherwise  materially
modify the requirements  for eligibility,  then such amendment shall be approved
by the holders of a majority of the Company's  outstanding capital stock, voting
either in person or by proxy, and entitled to vote at a meeting duly held of the
stockholders of the Company.

Use of Proceeds.
         The proceeds  received by the Company from the sale of shares  pursuant
to Options granted under the Plan shall be used for general  corporate  purposes
as determined by the Board.

Indemnification.
         In addition to such other rights of indemnification as they may have as
members of the Board,  the members of the Committee shall, to the fullest extent
permitted by law, be indemnified by the Company against the reasonable expenses,
including  attorneys'  fees and costs,  actually  and  necessarily  incurred  in
connection with the investigation and defense of any action, suit or proceeding,
or in connection with any appeal therein,  to which they or any of them may be a
party by reason of any action  taken or failure to act under,  or in  connection
with, the Plan or any Option granted thereunder, and against all amounts paid by
them in settlement  thereof (provided such settlement is approved by independent
legal  counsel  selected by the  Company) or paid by them in  satisfaction  of a
judgment in any such action,  suit or proceeding,  except in relation to matters
as to which it shall be adjudged in such action,  suit or  proceeding  that such
Committee member is liable for gross negligence or misconduct in the performance
of his or her duties; provided that within 60 days after institution of any such
action,  suit or proceeding  the Board member shall in writing offer the Company
the opportunity, at its own expense, to handle and defend the same.

Effective Date.
         This Plan shall be effective as of April 1, 2002; subject,  however, to
the condition  subsequent of approval by the requisite  shareholder  vote at the
next ensuing annual meeting of shareholders of the Company.

Duration of the Plan.
         Unless  previously  terminated  by  the  Committee,   this  Plan  shall
terminate  at the close of business on March 31,  2012,  and no Option  shall be
granted under it thereafter,  but such  termination  shall not affect any Option
theretofore granted under the Plan.